MD_DA431                                                         
DA                                                               
MD DA431 BUTTER - CENTRAL                             

MADISON, WI.  May 7, 2008 (REPORT 19)
                       
CENTRAL BUTTER

The CME cash butter price continues to increase to levels not 
seen since mid August 2007.  The mid week cash price of $1.4575 
compares to $1.4550 last year at this time.  A year ago, the cash 
price was also experiencing gradual strength and topped out in 
early June at $1.5625.  Many butter producers and handlers 
indicate that they do not foresee why this trend should not 
continue and maybe even surpass last year's level.  Most 
attribute the current strength to international sales that 
continue to clear good volumes of butter to offshore sights.  
Churning activity in the Central part of the country is 
seasonally active, although some butter producers indicate that 
outside cream offerings are lighter.  Some attribute the lighter 
offerings to increased Class II demand, especially for ice cream 
production.  Overall butter demand is seasonally active, 
stimulated by occasional retail feature activity.  Some buyers 
are now questioning what increasing dairy product prices might do 
to overall dairy sales at the retail and food service level.  
Increasing dairy product prices along with overall economic 
stress on family budgets are anticipated to impact food buying 
patterns.  Some restaurant and food service facilities report 
that their sales patterns remain on track with previous years, 
while others state that they are experiencing lighter sales.  
Resort and vacation areas continue to place orders for the 
beginning of the upcoming summer vacation period, but are also 
proceeding cautiously.  Spot bulk butter prices range from flat 
to 2 cents per pound over various pricing basis and averages. 

1500C steve Schneeberger  608-250-3204